SIME SELLS LAND, BUYS ESTATES & PALM OIL MILL FROM I&P

PETALING JAYA – Sime Darby Bhd yesterday announced that it has sold land in Semenyih for RM428.8 million to I&P Group Sdn Bhd and bought two estates and a palm oil mill in Johor for RM106.69 million, from the same.

“This is a deal that makes sense for both parties. We were able to match our needs in line with our growth plans. The Plantation Division will be buying brownfield assets, its first land expansion in Malaysia since 2007 and it will immediately contribute to earnings. Our Property Division will be able to focus on strategic developments such as the Malaysia Vision Valley and City of Elmina,” Sime Darby President and Group Chief Executive Tan Sri Mohd Bakke Salleh said in a statement.

Permodalan Nasional Bhd are shareholders in both Sime Darby and I&P Group Sdn Bhd, the holding company of the companies involved in the transactions.

In a filing with Bursa Malaysia yesterday, Sime Darby said its subsidiary The Glengowrie Rubber Company Sdn Bhd (GRC) has entered into an agreement with Petaling Garden Sdn Bhd to dispose off two parcels of land for RM428.8 million.

The two parcels of land which are currently in use as an oil palm plantation by Bio Technique Engineering, have a net book value of RM51.5 million as at the financial period ended June 30, 2016.

The land is located in the Hulu Langat District, which is not a key development focus area for Sime Darby Property. The deal will require the approval of GRC’s minority shareholders.

“This is an opportunity to unlock the value of our assets at a reasonable consideration during a softening property market. This will free resources for strategic projects such as the City of Elmina, a new township that is being developed with wellness and liveability in mind,” said Sime Darby Property Managing director Datuk Jauhari Hamidi.

The group also announced that it had purchased Talisman Estate and Lian Seng Estate comprising 198 parcels of lands measuring 768.5 hectares for RM77.6 million; and The Bintang Palm Oil Mill a 70 metric tonne per hour palm oil mill which is licensed to process up to 360,000 metric tonne of oil palm fresh fruit bunches per annum, for RM29.09 million.

Both Talisman Estate and Lian Seng Estate are located in close proximity to Sime Darby’s oil palm plantations in Johor Central, and brings potential to generate synergies and cost savings in terms of sharing estates and mills management.

The land disposal and asset acquisition are not conditional upon one another.

– Sundaily

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